Nikkei 225 reaches a 30-year high as Japan expects better-than-expected GDP

Nikkei 225 reaches a 30-year high as Japan expects better-than-expected GDP

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The Nikkei 225 (N225) according to data provider Refinitiv Eikon, the index jumped 1.9%, crossing the 30,000-point threshold for the first time since August 1990.
Inventories rose after the country had a stronger-than-expected GDP figure, and the economy expanded by an estimated 3% in October-December, compared with the previous quarter. This comes down to an annualized rate of 12.7% and was much higher than analysts had expected.
Overall, the Japanese economy shrank by 4.8% last year, less than the 5.3%. which the International Monetary Fund predicted. By comparison, the U.S. economy shrank by 3.5% in 2020, while Germany saw its GDP contract shrink by about 5%.

‘The fixed [performance] confirms the economy has continued to recover from its downturn caused by pandemics, ‘Stefan Oxrick, senior economist at Oxford Economics, wrote in a research note.

“However, high-frequency data show that momentum began to decline in December amid an increase in Covid-19 cases.”

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Japan is currently battling another wave of coronavirus infections, which has prompted the government to impose a state of emergency in parts of the country.

Angrick said he expects the measures “will bring the recovery back in 2021, but not derail it, especially as an early lifting of restrictions seems likely.”

Japan has just granted its first approval for a coronavirus vaccine, giving the green light to the Pfizer BioNTech shot. Sunday’s news spurred hope that the recovery could fit.

“At this stage, the outlook for Japan looks more favorable and the negative risks are starting to fade. Not only are local cases from their third wave past their peak, but the approval of the Pfizer vaccine is an important development that will make the vaccination possible. starts this week, ‘says Shahana Mukherjee, an economist at Moody’s Analytics.

“We maintain a cautiously optimistic view of Japan’s recovery in 2021, provided the vaccine fight takes place without much interruption,” she told CNN Business.

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Japan is not the only country to report better GDP data. According to Jeffrey Halley, senior Asia-Pacific market analyst at OANDA, Thailand and Singapore both posted good new figures, which helped build investor confidence.

Other markets in the region also rose on Monday, with that of South Korea Kospi (KOSPI) index climb 1.5%. The markets in Singapore, Malaysia, Indonesia and Australia also went up, while the stock exchange in China and Hong Kong on the mainland was closed for the New Year holiday.

‘The underlying picture is one of an emerging recovery in … Asia [outside of China], “Halley written to customers. “The optimistic tone is likely to continue in Europe unless we get some negative surprises.”

The FTSE 100 gained 1.4% in early trading in London. Germany’s DAX rose 0.4%, and the French CAC 40 added 1.1%.

CNN’s Junko Ogura in Tokyo contributed to this report.

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